Bangladesh Bank on Monday relaxed rescheduling policy for all kinds of loans of the businesses who have suffered losses due to the current political unrest for the next six months.
The central bank’s move came after the country’s major trade bodies demanded for the support as the businesspeople are now facing dull situation amid the political violence.
The BB on Monday issued a circular to managing directors and chief executive officers of all scheduled banks saying that they (banks) would be able to receive relaxed down payment to reschedule the classified loans on the basis of the bankers-customers relationship.
The BB circular said that the banks would be able to restructure the loans of the unrest-hit businesses.
The BB took the decision after holding two rounds of meetings with the state-owned commercial banks and the private commercial banks on Monday.
BB deputy governor SK Sur Chowdhury presided over the meetings while top officials of the central bank and the scheduled banks attended.
‘The BB has taken the decision as the major trade bodies demanded that the central bank should relax the policy to support the businesses amid the political unrest,’ Sur told reporters after the meetings.
The businesspeople will be able to reschedule their classified loans by giving a relaxed down payment on the basis of the bankers-customers relationship, he said.
The banks will have to give the facility to the businesspeople who have plunged into business crisis due to the political turmoil, Sur said.
The BB circular said the banks would have to take ‘no objection’ from the central bank for offering the relaxed rescheduling and the loan restructuring facility after taking approval from the bank’s authorities.
Transportation system of the agriculture products and the industrial raw material has faced a setback due to the existing unrest which has put an adverse impact on the country’s business and the economic activities, the circular said.
Under the circumstances, the BB relaxed the loan rescheduling and the restructure policies to save the businesspeople from the impact of the unrest.
The BB circular said that banks would be able to set the down payment for agriculture loans like SME loans on the basis of the bankers-customers relationship.
The relaxed policy will remain effective till June 30, 2014, the circular said.
As per the previous rules, a client had to pay at least 5 per cent to 15 per cent down payment of the total loans of demand and continuous category to make rescheduling for the first time.
The banks had to take maximum 50 per cent down payment for the defaulted loan of the demand and the continuous category for the third time rescheduling.
The BB relaxed the SME loan rescheduling policy on December 18. On Sunday, the Federation of Bangladesh Chambers of Commerce and Industry demanded the facility for all businesses.
‘The central bank has assured the banks that it will give support to them (banks) so that the existing political unrest would not hit the banks’ business hard,’ Association of Bankers, Bangladesh chairman Nurul Amin told reporters.
He said the BB decisions would put a positive impact on the banks’ year-end situation.
A BB official said that majority of the banks would have to count losses amid dull business due to political unrest if the central bank did not relax the loan policy.
Due to the latest policy, the banks will be able to avoid the provisioning against defaulted loans as they will reschedule the classified loan by taking relaxed down payment, he said.
-With New Age input
